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Revenue addresses evasion controversy
The tax authority has published a statement on tax evasion, in response to the HSBC Suisse controversy. The section addressing the bank’s leaked data reads:
“HMRC set up a project called Operation SOLACE, which at its peak had around 300 tax specialists systematically examining the leaked HSBC Suisse data, to assess how it could be used to identify tax evasion and whether it provided sufficient evidence to support enforcement action against UK account holders.
“The HSBC Suisse data initially revealed 6,800 entities – individuals, businesses and trusts – but this contained duplication… Removing duplication left us with 3,600 entities, all of which we have examined.
“We have investigated and challenged more than 1,000 account holders, and collected £135m from them in unpaid tax, interest and fines. In many of these cases, people chose to disclose their offshore income through the Liechtenstein disclosure facility (LDF), set up by international agreement, which gave them an exemption from criminal prosecution if they fully disclosed all information.
“In 150 of these cases, we sought to collect evidence for criminal prosecution. To do this successfully, we needed to demonstrate criminal intent… In addition, because stolen data is considered ‘dirty’, it needs additional corroborating evidence.
“With these tests of evidence, and with the exemptions arising from the LDF, we could only prepare [sic] three cases for submission to the Crown Prosecution Service (CPS). Having examined the evidence, the CPS considered only one case to be strong enough to take forward, and that was successfully prosecuted in 2012.
“In around 2,000 cases, we found no evidence of evasion and believe the account holders to be compliant, although we continue to monitor them. We are still examining around 100 cases, and 400 cases were untraceable.”
The Revenue explains it received the HSBC data from its counterpart authority in France, under strict international treaty conditions, which limited use to pursuing tax offences.
HMRC were not allowed to share the information with other law enforcement authorities or use it to investigate non-tax offences. Tax officials say they are “awaiting formal written confirmation from the French that they will alter the conditions to allow [the data’s] wider use… and have already started discussions with other UK law enforcement agencies about exploiting it”.
The taxman believes that “only the UK and Ireland have prosecuted anyone from the HSBC list for tax evasion”.
